A Foundation for Sustainability
For many nonprofit organizations, the challenge is not a lack of vision or commitment. It is sustainability. In a constantly evolving development landscape, achieving lasting impact depends not only on what organizations do but also on how they are supported.
Most funding in the development and philanthropic sector remains project-based and restricted. While these grants support important activities and measurable outputs, they rarely cover the full cost of running an organization. Essential areas such as governance, financial management, leadership, and organizational capacity often remain underfunded, despite being critical for long-term sustainability.
As a result, organizations operate under constant pressure to maintain their core functions. Leaders spend significant time securing new grants, teams manage multiple projects with limited capacity, and strategic priorities are often determined more by available funding than by long-term goals.
The issue is not that project funding is ineffective. It is that, on its own, it cannot sustain an organization. Without a strong and stable institutional foundation, even the most impactful initiatives struggle to endure. Just as one cannot build a great building on a weak foundation, civil society organizations cannot deliver lasting impact without reliable institutional support.
This is where unrestricted funding becomes critical. Rather than limiting resources to a single project or activity, it supports the organization as a whole. This flexibility allows leaders to allocate funds where they are most needed. It enables organizations to invest in people, strengthen operational systems, improve governance structures, and pursue strategic priorities that ensure long-term sustainability.
Why Unrestricted Funding Matters: Evidence from the Sector
The importance of unrestricted funding is not only conceptual. It is supported by clear evidence.
Research by the Center for Effective Philanthropy shows that organizations receiving flexible, unrestricted support are significantly better positioned to strengthen their long-term sustainability. In a multi-year study of recipients of large unrestricted grants, nearly 90 percent of nonprofit leaders reported improved financial stability, while 93 percent said their ability to achieve their mission had increased.
Despite these benefits, unrestricted funding remains limited. According to the 2025 Nonprofit Sector Survey by the Nonprofit Finance Fund, 64 percent of nonprofits reported that less than half of their funding was unrestricted, and 75 percent identified raising unrestricted funding as a challenge, with nearly half describing it as a major challenge.
This persistent funding gap is compounded by growing service demands. Eighty-five percent of organizations expect demand for their services to increase, yet many continue to face financial strain. More than one-third reported ending the year with an operating deficit.
Taken together, this evidence highlights a structural imbalance: civil society organizations are expected to respond to increasingly complex social challenges while operating with limited financial flexibility. Unrestricted funding is not a luxury. It is essential for resilience, adaptation, and long-term impact.
Foundations Advancing Flexible and Unrestricted Funding
Encouragingly, a growing number of philanthropic institutions are rethinking how they fund. Recognizing that strong organizations are the foundation of lasting impact, these funders provide unrestricted, flexible, or multi-year support that allows partners to define their own priorities.
Across regions and sectors, notable examples include:
Provides unrestricted, multi‑year funding and trust‑based support to African‑led organizations across Sub‑Saharan Africa, allowing partners to direct resources according to their own priorities.
Draper Richards Kaplan (DRK) Foundation:
Provides early‑stage operational support to social impact organizations. DRK offers up to $300,000 in unrestricted grant funding or investment capital over three years, along with guidance to strengthen leadership, build capacity, and scale impact.
Provides unrestricted multi‑year funding that partners can allocate as they see fit, combined with trust‑based operational support, coaching, networking, and access to community‑building resources.
Provides unrestricted funding to all grantee partners, with a minimum three-year commitment renewable on a two-year basis and two granting rounds per year. Each organization receives at least USD 100,000 annually, often more, and joins a global community to share knowledge, collaborate, and address common challenges.
Provides core, flexible, multi-year grants (up to five years) to women’s rights and feminist organizations in ODA-eligible countries. Calls are not open annually due to the multi-year nature of the funding.
Through its Building Institutions and Networks (BUILD) initiative, the Ford Foundation provides general operating support alongside institutional strengthening support, typically over five years, to help organizations build long-term sustainability and resilience.
Provides flexible, trust-based funding to community-led organizations, with a grantmaking approach centered.
Provides general operating support grants that are unrestricted and flexible to cover the real costs of social justice work. Grants are multi-year, allowing groups to plan long-term. The foundation follows grantee partners’ leadership, supporting them in addressing needs, opportunities, and challenges on their own terms.
Through its Core Fund Grant Program, the Honnold Foundation provides unrestricted grants to community‑based organizations working to expand equitable access to solar energy, with typical awards ranging from approximately USD $25,000 to $150,000.
Generally commits multi‑year, core support (general operating support) or flexible project grants that align with its programme strategies. The foundation believes that good grant‑making means allowing grantee partners to direct their work as they see best. Grants range from USD 25,000 to USD 10 million.
Provides general operating support to cover day-to-day costs alongside project-specific funding, typically not exceeding one-third of an organization’s budget. Guided mostly by program staff, they provide funding to movements, coalitions, networks, collectives, and informal groups.
Provides unrestricted, multi-year general operating funding, allowing grantee partners to decide how best to use the funds to support their work. The foundation takes a low-burden approach to reporting and invests in visionary local leaders and organizations tackling development challenges and opportunities in Africa.
Provides unrestricted, multi-year funding grounded in trust-based philanthropy. The foundation does not accept applications, relies on its own research to identify partners, requires no written reporting, and prioritizes long-term relationships through annual check-in conversations. Grants typically run from two to six years, giving partners flexibility and funding security.
Provides unrestricted, mostly multi‑year funding and ongoing support to help organizations achieve their goals, leaving partners in charge of defining progress and directing the use of funds. The Collective believes that the issues involved and potential for impact are always greater and more accurately understood by the partners themselves than by the funders.
Provides long‑term, flexible, trust‑based funding to grassroots groups and movements, especially in Africa, Latin America and the Caribbean, and Asia and the Pacific, allowing partners to use resources in ways that best support their own strategies and change processes.
Youth Climate Justice Fund (YCJF):
Provides core, flexible, trust-based funding to emerging youth-led climate justice groups, supporting leadership development, resources, capacity-building, and movement-building. Grants for 2026 are up to USD 20,000 for local groups and USD 40,000 for national groups. The application deadline is March 1, 2026.
Provides long‑term, unallocated support to nonprofit organisations working for a fair and resilient food system in Europe, moving away from traditional project funding toward long‑term, flexible funding with trust‑based partnerships.
Provides unrestricted grants to support grassroots social movements and systems‑change activism, funding a wide range of activities including organising, campaigns, community-led efforts, and core funding for groups. Grants are awarded through a rolling grant cycle, with total funding ranging from USD 1 million to 5 million. Funding is focused on Eastern and Western Europe.
Provides unrestricted funding when partners work within the foundation’s focus areas and priority countries. They support organisations that address significant needs with proven, scalable models, and may fund partners for as long as there is confidence in their success and need for additional funds.
Provides unrestricted organisational funding and restricted project funding. Partnerships can be direct or indirect, with standard grants lasting up to four years and new partnerships typically starting with a one-year trial grant. The foundation emphasizes collaboration with partners, ensuring that grantmaking aligns with their needs and goals.
Provides long‑term, unrestricted, and flexible funding to nonprofit organisations that share its values and operate in its focus areas, backing work to support communities facing poverty and inequality and restore balance to the environment.
If the goal of philanthropy is lasting change, then funding must support not just projects, but the organizations behind them. Without strong institutions, impact remains short-lived.
Strong projects deliver results. Strong organizations sustain them.
For organizations navigating this landscape, access to guidance and practical tools can make a difference. You can explore our comprehensive resource guide that offers strategies, real-world examples, and actionable insights to help you craft proposals that align with funder priorities, secure flexible support, and ultimately advance your mission.
